Short-term financing up to $500K for retail or e-commerce businesses.

This online lender specializes in short-term working capital loans for retail or e-commerce businesses that’ve had trouble getting approved elsewhere. It has a high approval rate, and every borrower pays the same interest rate — regardless of your revenue or credit score.
But its fees can be high. And it requires daily or weekly repayments, making it less flexible than other options out there.

$10,000

Min. Amount

$500,000

Max. Amount

Details

Product Name IOU Financial working capital loan
Min. Amount $10,000
Max. Amount $500,000
Loan Term 6 months to 2 years
APR 8.8% to 9.5%
Requirements 1+ year in business, $100,000+ annual revenue, average daily bank account balance of $3,000+, retail or e-commerce business with 10+ deposits a month, own at least 80% of business

Application Criteria

  • Retail or e-commerce business
  • At least one year in business
  • $100,000 annual revenue or higher
  • Average daily balance of $3,000 in business bank account
  • At least 10 monthly deposits in bank account
  • Own at least 80% of business
  • Not located in Montana, Nevada or Washington, DC

First, do I qualify?

You must meet the following criteria at a minimum to qualify for a small business loan from IOU Financial:

  • Retail or e-commerce business
  • At least one year in business
  • $100,000 annual revenue or higher
  • Average daily balance of $3,000 in business bank account
  • At least 10 monthly deposits in bank account
  • Own at least 80% of business
  • Not located in Montana, Nevada or Washington, DC

IOU Financial might have additional requirements that can affect your application.

What makes IOU Financial business loans unique?

IOU Financial is one of the the few business lenders that offers the same flat rates, origination and administrative fees to all customers. This could make it a good option if you’ve struggled to get a competitive rate in the past.

But it might not be the best choice if you have excellent credit and an established track record of strong revenue spanning a couple of years. In that case, you can likely find a better deal elsewhere.

What is an IOU Financial business loan?

An IOU Financial business loan is a short-term unsecured loan meant to cover day-to-day expenses or help you grow. You can borrow between $10,000 and $500,000 and repay it over terms of 6 to 24 months. Everyone pays the same 9.5% interest rate and fees. The fees include:

  • Origination fee: 8.8% 
  • Administrative fee: $395
  • Guarantee fee: Varies

Almost half of borrowers use the loan to buy equipment, while other popular uses include business expansion, cashflow financing and inventory. While it doesn’t require collateral, business owners must make a personal guarantee, promising to pay the loan back if the business can’t.

What are the benefits of an IOU Financial business loan?

From its flat rates to its option for renewal, here are a few perks of taking out an IOU Financial business loan:

  • High approval rate. IOU Financial claims that 85% of applicants get approved.
  • Same rates for everyone. Everyone pays the same 9.8% interest rate on its business loans.
  • Renewal available. You can apply to renew your loan after repaying 40% of your balance.
  • Easy to reach. We were able to quickly get answers to most of our questions about IOU Financial by using the live-chat feature on its website.

What to watch out for

Consider these potential drawbacks before borrowing from IOU Financial:

  • Lots of fees. IOU Financial charges more fees than your typical online business loan.
  • Lack of transparency. This lender doesn’t display the interest rate or guarantee fee on its website — and its loan calculator doesn’t give an estimated APR.
  • Daily or weekly repayments. Repayments this frequent can cramp some business’s cash flow, which is why there’s a daily minimum balance requirement.
  • Not available in all states. IOU Financial doesn’t lend to businesses in Montana, Nevada or Washington, DC.

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